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Toshiba Settling Billion Dollar Lawsuit
male writes "A couple of ambulance chasers found out that Toshiba ignored a minor bug in it's hardware ten years ago, and is now suing them over it. Now Toshiba could be out 2 billion (with a B) dollars! The guys who brought the suit get a couple thousand, and the lawyers get a over 100 million...
" You should read this article. It's pretty freaky.
It was possible (they had been notified by panasonic) that, while under heavy graphical or other load, data written to the floppy could be lost.
Toshiba was unable to duplicate this in the lab. No customers reported lost data. But panasonic sent the memo saying that it *could* happen, and they didn't change the design. *wham*
Look at your car. Any car. The manufacturor knows of all kinds of things that *could* go wrong and cause death, most of which could be fixed for a few dollars. The manufacturor chooses which ones are worth fixing, and which risks are too remote. If they fixed them all, all cars would start at $100,000, weigh five tons and up, and get four miles to the gallon.
But then, when one of the remote risks does come true, they get hit not only for actual economic damages (which is not a problem; this much is really just a variation on insurance), but also general damages (loss of quality of life, pain & suffering, etc.) in whatever multi-million dollar figure amount a jury pulls out of thin air, and even punitive damages.
And this is before class-actions get abused. The idea of a class action suit is to handle similar claims for damage together for judicial economy. But now, as here, we've eliminatged the "damage" requirement.
I don't see the situation getting any better. And why did I close down most of my practice to head for law school? . . .
hawk, disgruntled & disillusioned esq.
About six months ago, I received a letter from an attorney describing a class action suit that had been imposed on Fujitsu, which I believe had to do with eventual failure of the batteries. (I did notice that my battery didn't hold a charge, even after just two years of moderate use). They offered either a free new battery, or a (whopping) 16Mb RAM upgrade. I took the battery.
It would be interesting to hear from a lawyer regarding this issue; if software/hardware bugs can be construed as illustrative of a 'defective' product, and whether there is such a history of these cases. It's a bit surprising that Toshiba backed down so easily from something that could have (probably) been fought.
Maybe some similar lawyers are licking their chops with the prospect of going after Microsoft. I can't say I'd mind, to tell you the truth. I'm not one for trivial lawsuits, but I'm also sick and tired of buying buggy software, and being told to live with it.
HebGb
The last thing the court wants is a mistrial or a hung jury, as that is time-consuming, expensive, and unpopular with the public. (Plus the waste of time for the jury members (which granted is only a few days normally).) And in most cases there is a desire by all parties to see a fair trial.
The purpose of the selection process is not to pick the "right" people for the case; it's to make sure the wrong people aren't selected. The questions asked by the attorneys are geared towards weeding out people who are biased ("Would the defendant's race influence your opinion as to his innocence?", have too much emotional involvement ("Have you, or anyone in your immediate family, been the victim of a robbery?"), or are otherwise mentally/emotionally unfit to serve. After these people are eliminated, twelve of the remaining candidates are randomly selected. These twelve people will usually be "average" citizens who are going to do their best to make the right decision. It's a weighty responsibility, to sit in judgment of someone's life, and most people do treat it with the proper respect and attention.
I am a firm believer in the functionality of trial by jury. Yes, it can be twisted or bent -- but it's a lot more fair to the defendant than anything else I've seen.
It says the class action could have led to toshibas bankruptsy ($9 Billion dmages) if they didnt settle.
And the fault was barely reproducable.
Contrast this with Micrsosft, windows is clearly defective, BSOD and all. Would it be possible for all windows users to take class action and bankrupt microsoft.
I think the only thing that would save MS is there is probably some legal clause saying microsoft is no way responsible for the software you pay them money for.
Jeez, read the article... the bug is sometimes the toshiba notebooks have errors writing to the floppy disk. Toshiba claims they haven't been able to reproduce the errors in the laboratory.
It's even worse when you think about how universally unreliable floppies are anyways. It shouldn't be a surprise to anyone if their floppy disk suddenly doesn't work.
Password: wanttogotoday
--
At least Toshiba has decided to take responsibility for their actions. I recall a situation in which I was on the development team of another (read= competing) laptop manufacturing company, that knew about what was also a rather inconsequential bug. Due to marketing and meeting deadlines, the bug was released intact with the product, and software programs that would invoke the bug (example : NT Service Pack 4) were simply labelled unsupported software.
Users of 'unsupported software' programs were urged to regress to SP 3 by the help desk, a task which any other Wintel users can say doesn't always work for the best.
It's good to see them NOT taking the same action. "Well, if the disk won't write in MS Office, we'll just bundle Smartsuite instead."
Offtopic, does anyone know of the circumstances that would cause the floppy to miswrite/malfunction? How common was the error produced?
One thing that does sadden me tho, is that ANY major company with a reputation to maintain, entrenched in competition by its peers, would allow anything known wrong out the door. NOTE FOR MANUFACTURERS - if there is a bug in your hardware, it WILL be found. There are too many myriad configurations of software/hardware for ANY single bug to go completely unnoticed. If you know about it, fix it before it hits shelves. Push deadlines back, the people will appreciate it...
Land of Litigation.
And before you folks start going off about how all laywers are inherently evil (as some have already started doing), consider the possibility that it's our laws and judicial system that's at fault here. There will always be laywers stepping up when another one backs down due to his own ethics.
Face it: Americans like being able to blame somebody. They like the security lawsuits give them. They know that if they do something pretty stupid, they usually have the ability to save face and sue somebody else. It's this mentality that has made our judicial system what it is today...
Sites that require free registration do so for only one reason: they want a mailing list. They don't gain any money from the registration, so where else would they gain it from? People should realize this and refuse to ever register for anything that is supposedly free. If every company that tried this found that it fails every time, I would not have to waste my time bullshitting them every time I want to read an article. While I'm at it, is there a reason why so many articles from this site appear here? Can anyone really tell me that nytimes is the ONLY place that has any news on this event whatsoever? Maybe that could be true, but I doubt it.
I would like to know one thing: If a hardware manufacturer can be hit this hard because of a rather minor bug in one of its hardware products that hasn't really caused any damage...
Then why can we not hit Microsoft, a software company, just as hard when their OS crashes and people lose data because of it? Damages caused by this one are quite well documented, and don't tell me Microsoft is ignorant of this fact.
It is because of Microsoft that the general public thinks that having to reboot an OS every week or every few weeks is OK. To me, the OS is more important than the floppy drive, as I can do without one but not the other. I run Linux, but at work I am forced to use Windows. It has crashed on me numerous times while I was in the middle of something. I save my work frequently, and it still has cost me a lot of time spent redoing work that should not have been lost. What about the company I work for? When I have to redo work like this, they lose money.
How many other companies out there are affected by this?
While I think this suit against Toshiba is a bit blown out of proportion, this is a great thing if it is any indication of big business in the IT industry actually being held liable for shoddy products.
Beats what I "got" from a class action settlement from Cellular One. What did I "get"? $15 off any *new* service costing at least $75, which does *not* include paying my current bills with it. Sounds like they made a deal with the lawyers, so the lawyers get megabucks, the company gets off relatively cheaply, and the customers get diddly.
I'm married to a lawyer, but she works for the government and thus I'll never see one of these settlements. (Oh well, at least I can live with myself...)
Ooh, a sarcasm detector. Oh, that's a real useful invention.
>I don't know about you buddy, but I like the judicial system the way it is.
You like the outcome of a case such as this? 140 Million for the law firm? This is nuts.
Lawyers should get paid by the hour (200 dollars an hours is pretty nice) and never get any of the settlement money. EVER. This is one of the MAIN reasons our judicial system is so forked, it allows lawyers to suck our blood.
Other countries laugh at us. A couple ladies in California suffered bad burns after a drunk driver plowed into their car and it burst into flames. Who did they sue? General Motors! Worse, the jury awarded these ladies 10 Billion dollars. GM was pretty surprised, so was I. They MIGHT get it down to a Billion on appeal.
Bet you a US dollar that nobody on the jury could even write out 10 Billion, being the lowest educated people that the prosecuting lawyers could find.
So, 2 things are needed immediately. Flat rate lawyers and review of jury members by an independent party (judge).
Since > half of our lawmakers are lawyers (big surprise), you will never get legislation passed and we will continue in this spiral till the whole thing falls apart. It will take the bankruptcy of Boeing or GM to actually get anything to happen. Too bad, eh?
-kabloie
I agree, lawsuits are necessary. What I do have a problem with is our (US) tort system. It is wildely expensive for both parties, even if one party is clearly in the right. It is very time consuming. Juries are technically incompetent (e.g.: law, medicine, science, business, etc), many times they're functionally illerate. And last, but not least, the awards are all too often far too high.
...I can go on.
I don't regard billion dollar awards against billion dollar companies to be anecdotal. It would be equivalent to calling TB and the bubonic plague an anecdote when talking about the dangers of diseases. Sure, they're both singular cases, but you have to look at the costs.
None the less, there are plenty of high dollar awards that I can name in the past 5 years. These are things that any business man is all too well aware of. Beyond Ford and GM, billion dollar awards in California, we have other more aggregious cases. For example, Dow Corning (not to mention other silicon producers) who was sued successfully for producing breast implants; they're no longer in business. In this case, it was never proven that they even leaked in the case. Futhermore, it has been proven repeatedly that such nominal leakage has no such effects on the human body. Yet, you have billion dollar awards against multiple companies, and hundreds of millions in legal fees (even today). I can tell you from personal experience, that these manufactuers that are still in business REFUSE to allow their silicon products to be used in implantable medical devices, even if they have no direct involvement in its usage. The result? Silicon, the superior and safer product, can't be used in such devices cost effectively. These are real costs, in many areas. There is also Cesna aircraft, now brankrupt, in an even more absurd case.....
I can also point to multiple cases against my parents', family's. and friends' companies. Cases in which, they've been told by their lawyers that it would be cheaper to settle than it would be to WIN. Cases in which the plantiff is clearly a fraud, who has been in and out of the courts on similar yet seperate cases, yet the courts refuse to allow this piece of information in the courtroom. Cases in which even the judge sent the award back to the jury, saying it wasn't high enough to warrant the time involved.
There is nothing anecdotal about this. They are huge costs of doing business. They discourage people and products from entering various markets. People lose their jobs. Frauds get recieve huge awards and settlements all the time. The costs are far too high, win or lose; they're not an effective means of settling disputes. Anyone who runs a sizable business, or really any organization, is painfully aware of this. There is A LOT of room for improvement, my ideas are some of them.
Toshiba might be partially at fault. However, the fact of the matter is of more than a million laptops shipped, not one complaint was filled. We have no evidence that anyone was actually hurt. Toshiba is an OEM, and this part was purchased. It could very well have been an innocent mistake. You don't have any evidence to the contrary. Many companies are placed in such situations for more absurd cases.
PS: If you wish read a good essay on tort reforms, try this: http://www.cato.org/pubs/regulation/reg19n1e.html
This just goes to show how much of a lottery the US legal system is now-a-days. And these lawyers are just the latest people to hit the court-room jack-pot (though, if they had settled in court, the article says, they stand to have made 5 times there 147 million US each). The problem is entirely insignificant, even in DOS, it probably would not be a problem since about DOS3, with the copy /v (verify) flag set. It would go "wow, there is a byte in the wrong place. lets fix it!"
Why is the civil case system so far out of reach with reality?
OFTC: By the community, for the community
Where's the problem? Use "cipherpunks/cipherpunks", as everone else does. I don't even consider this cheating, as the NYT people definietely know that account is being used by many people (and why should they care?).
what other floppy drive controllers have the same problem... True, it's a very bizarre bug to trip, but FDC's in general are all pretty much the same. Other companies could have not replicated the fix, which means that other floppy drives could have the same problem.
Anybody have an idea as to how to test out if your FDC is flawed?
--
Jeremy Katz
Suing big business just because they have money to take is a bad idea. Notice in the story that the one who brought the suit, was also a lawyer. (and he wasn't really affected) And who got paid the most? The user? No. The lawyers.
This is just a case of greedy lawyers seeing green. Just like suing tobacco companies for billions upon billions of dollars. And now it's gun companies.
You may laugh, but one day someone is going to sue keyboard manufacturers, or mice makers.... car companies aren't immune. Their products kill more people than guns and smokes combined.
But he said the error would only go undetected if it occurred in the 512th byte of the 512 bytes that are recorded at one time, not in any of the other 511 bytes. Also, he said, it appeared to occur only when the computer was heavily loaded, such as when it was playing a video while also writing to the floppy disk.
They can sue Toshiba for that? Speaking of defective products..
5 minutes later...
sorry for that, I just BSOD'ed and had to reboot.
I have been in US as Student and Investiment visa holder. Sure I can not possibly be a jury. Voila, I was asked to come to court to be a jury. If not respond to the letter, there was threatning phrase.
I am sure it is completely random selection process with my experience but how many of hardworking citizens can be a jury.
But I hear many educated people are dropped during jury selection process. Do I want my life decided by unemployed alcholics? Or somebody hischool drop out working in the corn fields. Sure No.
These legal sytem of unaccountability is hurting this economy. Thanks god, US economy is strong enough to over come this kind of drawbacks.
Which leads me to thinking (and this is probably pretty out there, not being a lawyer): under US (or any country's) law, once a product becomes a de facto standard, is it treated differently for lawsuits, etc? I'm thinking in terms of something similar to trademark law, whereby if a company's trademark is strongly associated with a product for a long time and the term falls into common usage, the trademark is rendered invalid (I'm being brief).
The argument being, because certain software is a de facto standard, people/businesses are forced to use it to maintain compatibility. But if this "standard" turns out to be unreliable and a financial loss results because of use of this product (which they were, in effect, forced to use), could someone successfully sue? Could this get an individual licence argreement declared invalid? Of course, the company involved would probably use arguments similar to Microsoft's at the antitrust trial ("It's not a standard, it's just...uh, ummm, uh...wanna see this cool thing called Linux?")
Probably a dumb, thought, but just curious.....
Still, it does smell like too much for this particular complaint. Could it be that they are really afraid that something else much more insidious would come out during discovery? What if they really aren't that concerned about loosing on this particular case, but that the information uncovered during discovery could lead to the real problem they fear?
Never underestimate the power of wishful thinking to filter what the eyes see and what the ears hear
Never underestimate the power of wishful thinking to filter what the eyes see and what the ears hear
--BuSa
I couldn't disagree more. 2.1 billion is not chump change, even for a company of Compaq's size. Smaller firms are hit harder, but big business is hit hard all the time (eg: Ford, Cesna, GM, etc) -- they're running scared. In fact, settlements such as there are proof. The fact that they'd rather CERTAINLY shell out 2.1 billion, than go all the way and risk god knows how much to an uncertain jury. The fact of the matter is that, despite selling more than a million such machines, not one person has actually filed a complaint as a result of actual damages. No one has proven that Compaq acted with malice, disregard, etc.
Civil lawsuits are out of control in the US. They need to be curbed. I recognize that they have their place, but I see far many more abuses than legitimate cases (for reasonable dollar sum). Some cases just shouldn't have layman (non-technical, non-legal, etc) juries. But in lieu of that, they need to cap punitive damages, or simply demand that they go to charity instead. That would eliminate a great deal of these suits. Not only would we see fewer frauds being awarded the big bucks, but you would get secondary and tertiary effects. Namely, companies would be more willing to litigate these cases, rather than settling anything with the potential for high dollar awards -- serving to further cut back on fraudulent cases. It would create a more equitable system.
that Toshiba did something heinous and horrid by perpetuating this error-prone floppy controller chip for a decade, while the error was known, is it possible that we could pay the lawyers a little more, for the service that they have provided to mankind, nay, the whole universe. It would be worth putting several quality hardware vendors out of business just to help those guys buy a couple of new Mercedes...
</sarcasm>
But really, rather than the lawyers, or the justice system, doesn't the public also have a part to play in the ridiculous levels of awards (odd word choice, that) at trial? It is the jury that will award multi-billion dollar punitive damages - thus leading to exagerated settlements like the above. The lawyers work for a percentage, and will always be overpaid. But an under-educated, unthinking, under-clued jury is at the root of these types of settlements. It is the jury who says "These people are just awful - let's fine them 10 billion dollars", as if awards of that magnitude don't have social costs of their own. If juries were reasonable, then... oh, forgive me, what AM I saying.
OK, Toshiba dropped the ball - they should have fixed it when they found out there was a problem.
But $2 Billion?!? What sort of accounting could you ever possibly do that would result in a loss potential for consumers of that amount. Even if you assume punitives, I couldn't see it.
You don't even hear those kinds of numbers where people die (unless you count tobacco, where tens of thousands were hurt and killed).
I respect Toshiba for settling. But, I wish they would slug it out in court.
The little guy just ain't getting it, is he?
I wonder if I could sue MS for my lost term paper when it bluescreened on me...
Hmmm... that is comparable to an architect drawing his blueprints on an etch-a-sketch
You like to paint the world in black and white, good and bad, left and right, up and down; what results is a grey drab world. Over the years, I've observed the world becoming "safer", or people such as yourself like to say "erring to the side of safety". Well, I call it a greyer, more joyless existence.
In the name of that one in a million freak accident, we can't live our lives out as we see fit. In recent years, this trend has been growing. Our children are that much poorer for it. You ever wonder where that diving board went at your local swimming pool? How about the slide? The swings? You name it, they're disappearing fast across the country. Childrens' blocks? We can't have those, they might hit one another with it. Hot coffee, nope can't have that either. Silicon encased medical devices? Nope. Private conversations with teachers? Nope, can't have those either too much liability. It just doesn't end...
It is a shame. Quite frankly, ignoring the economic costs, this is all I need to throw my hands up in disgust; that you can advocate playing Russian Rullete with our companies, lives, and well being never ceases to amaze me. Every time a tort goes to trial, you would pull the trigger. Our tort system isn't equitable for anyone, regardless of your leanings, left or right. It is slow, inefficient, inaccurate, and highly costly.
Jury trials have their place, such as in criminal trials. They don't belong in highly technical tort trials. The juries aren't pursueded by the facts, they're pursued by the lawyers and so called "experts". Whomever has the most pitifull case wins. Nor should they be given the power to determine a company's future when it is clearly unreasonable.
I love my country, but the tort system is sick. We are one of the only countries in the world which still uses juries to adjudicate. We are certainly one of the only countries which awards over a billion dollars to an individual. Would you have us believe that the US is the only country where customers aren't trampled on, or that they're tampled on less? I, and many others would disagree. Infact, there is a strong argument that it is actually more hurtful than helpful....Products and services certainly are disappearing.
Anyhow, I could go on all day long, but I've got better things to do than argue with a naive kid with out practical experience or legal training. No amount of words will change your mind, you'll just have to learn the hard way. No offense intended.
How, precisely, is settling for $2 billion dollars a demonstration of invulnerability? By agreeing to that amount (which is a significant fraction of their worth...), they've acknowledged that they may not be able to beat the suit -- despite the fact that apparently nobody's demonstrated actual data loss or other incidental, related damages at all.
Um, right. Settling is often NOT a win for the defendant; often it's a Pyrrhic victory.
Only the dead have seen the end of war.
Toshiba laptop... still under warranty... bought in the US...
I have never had a problem with my floppy drive, though.
Then again. I rarely use it and I run Linux.
I like how all of the unclaimed pseudo-refunds are going to education. Now if only the greedy lawyers would send some over there as well rather than spending it on 30 cars, 10 houses, etc...
Hey, having trouble making ends meet? Follow Bob(TM)'s step by step guide:
Path to easy street
(1) Buy a piece of hardware from a big name company;
(2) Test thoroughly to find all bugs (what are the odds that a given piece of hardware has a bug? Better to consider the odds of NOT having a bug).
(3) Get a lawyer to bring a class action suit. Shouldn't have a problem finding these guys. Here are some possible sources:
* Billboards or TV ads
* Get a list of people who've bought scanners from Radio Shack. Should be pretty thick with 'em.
* Stop by your county court house - look for the guys with briefcases and pencil-line mustaches.
(4) Use the "what if I used my computer to control a nuclear medicine workstation" rationale for why the owe me big bucks. That gets 'em every time. You only need to show POTENTIAL harm, after all;
(5) (Optional) Get the list of "guests" from the Jerry Springer show to help you demonstrate harm caused by the product;
(6) Settle for bucks. Lawyers will get most. But, you know the real secret: VOLUME, VOLUME, VOLUME.
(7) Lather, rinse, repeat (go to step 1).
The little guy just ain't getting it, is he?
Sure, its a no-brainer that companies are responsible for their product, but is this bug worth anything near 1 BILLION dollars? Doubt it. They didn't even show us the obligatory, "My business lost 100 million dollars due to Toshiba's incompetance" sob story. Instead, we just get notice that this was a known bug, somewhat trivial, and somebody better pay us.
But somewhere out there is a college student who was up all night writing out a term report on his Toshiba, saved it to a floppy and ran out to the computer lab to print it out, only to find his data corrupt. Right now he's saying, "Take that you bastards at Toshiba!" At least he's happy.
Then again, who thinks floppy is a reliable media? I'm always worried about saving anything near a megabyte on a floppy.